The International Monetary Fund on Tuesday downgraded its forecast for global economic growth as Britain’s surprise vote to leave the European Union last month weighs on consumer confidence and investor sentiment.

The IMF notched down its global growth estimate for this year and next by 0.1 percentage point, putting 2016 at 3.1% and on par with last year’s pace, the slowest since the financial crisis. The fund expects a mild pickup next year to 3.4% annual growth.

But it warned that a host of threats—including geopolitical turmoil, rising protectionism and terrorist attacks—could push growth into a deeper rut. Meanwhile, central banks appear to be running out of options to juice output, reflected in part by bonds yields plumbing new depths around the world. Many emerging markets are still struggling to cope with China’s deceleration and the long-term slump in trade and commodity prices.

The British referendum “adds downward pressure to the world economy at a time when growth has been slow amid an array of remaining downside risks,” said IMF chief economist Maurice Obstfeld. The IMF had been prepared before that vote to nudge up its outlook on the back of firmer commodity prices and less-severe contractions in Brazil and Russia. “But Brexit has thrown a spanner in the works,” he said.

The IMF’s latest World Economic Outlook sets the tone for a meeting of the world’s top finance ministers and central bankers later this week in China. Officials from the Group of 20 leading advanced and developing economies will call on each other to deliver on long-promised policies meant to spur growth.

Brexit will likely take centre stage, with officials focusing on “the near and long-term implications of the decision by voters in the UK to exit the EU,” a senior US Treasury official said Monday.

“Continued uncertainty in the global outlook underscores the importance of all countries using all policy tools—monetary, fiscal and structural—in combination to boost growth,” the US official said.

Though many markets have stabilised after a post-Brexit selloff, the IMF warned the vote’s impacts will likely play out over time. The IMF cut prospects for eurozone growth next year across the board, including 0.9 percentage point for the UK to 1.3% and 0.4 percentage point for Germany to 1.2%.

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But the fund’s current outlook is based on a “benign assumption” that the UK and the EU preserve much of their key trade, finance and economic relationship.

That is by no means assured, however, due to the lack of clarity about the UK’s ultimate relationship with the EU. “More negative outcomes are a distinct possibility,” fund economists warned in the report.

A prolonged and acrimonious negotiation could drag down global economic growth to 2.8% this year and next, the IMF said. Brexit has already drawn new attention to Europe’s legacy banking weaknesses, with some officials warning the financial system could face another full-blown crisis.

“This overlay of extra uncertainty, in turn, may open the door to an amplified response of financial markets to negative shocks,” Obstfeld said.

Fund economists said policy makers need to “stand ready to act more aggressively and cooperatively should the impact of financial market turbulence and higher uncertainty threaten to materially weaken the global outlook.”

The fund also trimmed its forecast for US growth this year by 0.2 percentage point to 2.2% on the back of a weaker-than expected first quarter as a strong dollar and souring energy sector hit the economy.

Brexit added to Japan’s exchange-rate headaches as capital fleeing London sought refuge in the yen, one of the world’s safe-haven currencies. Instead of a planned upward revision for the world’s third-largest economy, a stronger yen forced the IMF to cut the country’s growth prospects for this year by 0.2 percentage point to a measly rate of 0.3% this year. Tokyo’s decision to delay a consumption tax increase means the country will avoid a recession. But the economy is only expected to expand by 0.1% next year.

Africa’s largest economy, Nigeria, took the largest revision as plummeting oil prices, production cuts, power outages and souring investor confidence took their toll on the nation. The fund cut its forecast by 4.1 percentage points for 2016 and 2.4 percentage points for 2017, putting the economy in a 1.8% contraction this year and a mild 1.1% expansion next year.

While the overall outlook is gloomy, the IMF cited a few bright spots in the global economy such as market resilience in the face of the surprise Brexit vote. The fund also raised its forecasts for Brazil and Russia, projecting the two commodity exporters will pull out of deep recessions next year.